Marijuana on Store Shelves Creates Colorado Cargo-Hauling Niche
At a farm in the foothills of Colorado’s Rocky Mountains, Corey Young tucks his client’s marijuana into a shoe box-sized container in an unmarked white van and heads out on the road.
“We don’t want to be going through a small town and have someone see bins in the back,” said Young, a founder of courier service CannaRabbit. “We do not want to stick out at all.”
Young wants to stay hidden not because pot is against the law. Colorado began legal sales of recreational marijuana last year. The secrecy is designed to ensure the safety of drivers shuttling cargo that retails for as much as $220 an ounce. CannaRabbit and peers are rushing in as regional truckers and nationwide haulers United Parcel Service Inc. and FedEx Corp. steer clear on concerns over the lack of nationwide clearance of a practice that is still illegal in most states.
“You don’t really see these kind of new industries popping up that often,” said Povilas Grincevicius, a spokesman for Denver-based Absolute Security & Personal Protection, another courier service for the state’s marijuana businesses. “This is one of those once-in-a-lifetime opportunities.”
Couriers do more than carry pot for the state’s network of more than 800 growers, manufacturers, dispensers and laboratories. The industry remains mostly cash only as federally chartered banks have been hesitant to extend loans for trade that U.S. authorities may see as against the law.
That’s why logo-free vehicles like CannaRabbit’s van are an asset. Young, 42, said he had worked on a pot farm named Maggie’s Farm LLC, after Bob Dylan’s 1965 song, just south of Canon City. Maggie’s Farm was delivering its own products to stores when “the labs started using us to go pick up their samples,” he said. “They trusted us to keep things untainted.”
As demand grew, Young said he started CannaRabbit with a partner and then joined forces with Security Grade Protective Services Inc. in 2014. The company’s 20 employees now serve 60 clients a week.
Colorado is at the forefront of setting transport rules, permitting third-party couriers with proper documentation. Other states that have legalized pot have regulatory hurdles.
Oregon, where voters approved legalization in November, plans to name a rules advisory committee in coming weeks to draft regulations, state Liquor Control Commission spokeswoman Karynn Fish wrote in an e-mail. The group will meet through October and the commission will begin accepting license applications for retail stores by January 2016.
In Washington, where legal sales began in July, outside carriers for marijuana businesses aren’t allowed, according to Brian Smith, communications director of the state Liquor Control Board.
Marijuana businesses are concerned that transporting pot on Washington’s rural roads without secured transport poses safety risks, state Senator Brian Hatfield said. He said a bill he co-sponsored to allow the outside delivery companies stalled.
Alaska also approved legalized pot in November, creating more potential opportunities for start-up courier services. District of Columbia voters agreed to allow residents to grow their own pot, though selling it would still be illegal.
The pot industry has been a boon for Colorado, which expects to receive $87.3 million in tax revenue from it next fiscal year. The state’s Marijuana Enforcement Division has issued about 340 licenses to recreational pot stores since the 2012 legalization vote, according to its website.
Employment in the growth, production and sales of the product grew 14% in the first quarter of 2014 from the end of 2013, Alexandra Hall, the chief economist for Colorado’s Department of Labor and Employment, said in an e-mail on March 9. That doesn’t include the impact from indirect jobs serving the industry, such as the couriers, she said.
Among those indirect beneficiaries are former Jefferson County Sheriff’s Deputy Dan Sullivan and ex-infantryman Ted Daniels, who started Blue Line Protection Group Inc., a Denver-based company that provides armored car services and security guards to the industry. Two other ex-deputies were their first employees, according to company spokesman Michael Jerome.
New Blue Line employees undergo 40 hours of training from Grant Whitus, a former policeman, Jerome said. The company has grown to 80 employees since starting in late 2013.
Jerome, himself an ex-Jefferson County deputy, voted against pot legalization in 2012, although with all the cash and high-value weed traveling across the state raising safety risks, he decided to get involved.
“The state voted for it so now we have to make it work,” Jerome said.
Making it work will require more of the marijuana businesses to turn to the professional couriers and give up transporting their cash and high-value product by themselves, said Michael Julian, chief executive officer of MPS International. MPS is a provider in Denver of guards and armored-car services to the industry.
“What’s stupid is somebody with no security training, no driving training, no surveillance training, in a 1999 Honda Accord traveling across the city with $200,000 in cash,” he said. “That’s foolish.”
